How will expansion of reconstruction in Karabakh affect real estate market?

Expanding restoration and construction works in the liberated territories will lead to a revival in the real estate market of Azerbaijan, Vugar Oruj, Chairman of the Azerbaijan Appraisal Society (AAS), told Report.

He said that the work done in Karabakh is a serious incentive for the market:

"Investment in those areas improves the economic situation in the country and creates an incentive for economic development. In any country where there is an activity aimed at economic development, there is a revival in the prices of real estate. Let's look at the last 30-year history of Azerbaijan's development. We will see that in the periods in which there were signs of economic development due to oil revenues or certain economic projects, the real estate price was higher than in other periods. Currently, very serious work is being done in Karabakh in the direction of infrastructure restoration, and both local and foreign companies are implementing investment projects. It can be the driving force for the beginning of the revival process in the real estate market in those areas and other regions of the republic. These works have just started, and we do not feel the impact of these works directly in our daily life. But if the activity in the direction of investment in those areas increases, this can be an incentive for a rise in the price of real estate. From this point of view, the innovations currently taking place in the regions of Azerbaijan, including the liberated areas, are directly related to the real estate market and can stimulate the market's revival."

Vugar Oruj said that the works done in Karabakh will increase the rent prices of real estate.

"Infrastructure restoration in any area takes place at the expense of manpower and equipment. It leads to an increase in the rental price of houses and equipment in the surrounding areas. Currently, construction equipment prices have increased by 25-30%. Attracting a new labor force to our liberated areas, creating a business environment in those areas and taking steps to restore infrastructure will increase rent prices in the surrounding areas. Currently, the state has created certain guarantees for the living of that region's labour force. But when this process takes a larger scale, we will see it reflected in the rent prices."

According to the expert, there is a food crisis, devaluation and other economic problems in the world: "These problems can compensate for the possible revival in the real estate market. If it were not for the listed economic problems, we could see much more revival in the real estate market," added the chairman of the AAS.